ETF Spotlight: iShares Dow Jones U.S. Financial Sector (IYF)

October 21st at 3:00pm by Tom Lydon

ETF SpotlightETF Spotlight on iShares Dow Jones U.S. Financial Sector (NYSEArca: IYF), part of a weekly series.

Assets: $616.7 million

Holdings: IYF holds some of the nation’s largest banks and financial institutions, including JP Morgan Chase (NYSE: JPM), Goldman Sachs (NYSE: GS), Morgan Stanley (NYSE: MS) and Bank of America (NYSE: BAC).

Objective: IYF tracks the Dow Jones U.S. Financials index.

What You Should Know

  • 41.4% of the fund  in banks; 26.9% is in financial services; 13.1% is in non-life insurance; 11.8% is in real estate investment trusts
  • The fund as a 0.48% expense ratio
  • There are 258 holdings in the ETF
  • Since the market’s low on March 9, IYF is up 121%

The Latest News

  • Wells Fargo (NYSE: WFC) reported that its profit jumped 61%, but its loan losses also jumped to more than $5 billion. Wells Fargo is simply getting in line with other big banks, which have also reported big losses from loans gone bad, reports the Associated Press.
  • Morgan Stanley (NYSE: MS) beat analysts’ expectations by reporting consolidated net revenues of $8.7 billion. The profit ends a three-quarter losing streak, and it can be attributed to Morgan Stanley’s new conservative stance in the wake of the financial collapse, Reuters reports.
  • JPMorgan Chase (NYSE: JPM) set a high bar for earnings, but Goldman Sachs (NYSE: GS) and Citigroup (NYSE: C) failed to reach it when they announced their third-quarter results this morning. Goldman Sachs reported $3.19 billion in trading profits that beat expectations, but the stock dropped on declines in investment banking revenues. Citigroup reported a smaller loss than expected, but credit losses are high, report Sara Lepro and Tim Paradis for the Associated Press.
  • The rally may not be indefinite, since banks still have their share of problems. But there’s still opportunity there, since financial ETFs are still about 50% off their 2007 highs. (Play the capital markets recovery).

For past ETF Spotlights, visit our ETF Spotlight category.

The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.

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